Just two years ago, the COVID pandemic and subsequent lockdown measures put majority of small and medium-sized businesses on survival mode. And as the saying goes, ‘every setback is an opportunity,’ many of these businesses turned to technology for survival. The transformation was critical for their survival, and proved instrumental in their growth, even during the pandemic.
As RBI data suggested, during the pandemic period, digital payments alone registered a CAGR of about 37% and it continues to grow. At the same time, internet speed and mobile user growth have also continued. As far as B2C e-commerce is concerned, in 2022, India will be the fourth-largest market in the world. However, the pace of growth should put us in the second position within the next couple of years.
With such opportunities knocking at our doors, it’s only a matter of time for SMEs to start investing in upgrading their tech reliance. Another trend that is pointing to this possibility is the growth in the adoption of cloud applications.
Cloud adoption is a major precursor to the next generation decision making and analysis technologies, i.e., AI ML, IoT and data analytics. Both public and private cloud services plus the end-user spend on public cloud services has registered double-digit growth over the past two-three years. Gartner expects this to register a 30% growth in the year 2022.
While consumer discovery and targeting (marketing) has seen the most active adoption of AI solutions, other areas are also expected to race on the same track for small businesses.
At a time when consumers expect businesses to be available 24×7, chatbots have been the solution of choice for enterprises. In 2022, as we progress further with Natural Language Processing, this technology will be more liberalised, leading to greater SME adoption.
Another rapidly expanding area for AI has been in financial systems or Fintech startups working to liberalise lending. These start-ups also serve SME customers, who have been largely ignored by prime lenders and institutions.
People management has been a pain area for many enterprises, especially with remote working conditions. However, large businesses have been quick to adopt the early AI-enabled HRM solutions with cloud services. 2022 should be the year when these solutions make inroads into the SME ecosystem as well.
While the root technologies have been making inroads among the population and businesses, the AI-Enterprise use cases have also been growing. In the past few years, we have seen the emergence of low-code and no-code AI applications. Needless to say, this democratisation will continue further, making it easier for SMEs to adopt these solutions in their day-to-day operations.
In terms of indigenous development, 2022 has registered more than 40 AI start-ups with close to USD 1 billion raised in capital funding. These start-ups are building AI solutions for specific enterprise and social problems.
For instance, Manthan has been operating in India for close to a decade now with its e-commerce analytics and NLP (natural language processing) solutions. Mad Street Den has brought AI and computer vision together to provide contactless consumer solutions to fashion and apparel businesses. We also boast of start-ups like Arya.ai, which provides solutions to other AI start-ups to accelerate their development programs.
After building a robust ecosystem for AI and tech start-ups, GOI has also announced the launch of the 5G spectrum for this year. This 5G implementation will also add fire to the already lit ‘AI for small businesses’ space.
Article is authored by Ravi Kumar, Founder of MadHawks.